Temporary Help Agencies

This guide is provided for your information and convenience only. It is not a legal document. For complete information, refer to the Employment Standards Act, 2000 and its regulations.

Temporary help agencies employ people to assign them to perform work on a temporary basis for clients of the agency. The duration of the assignment does not matter. Such employees are called “assignment employees”.

Under the ESA, temporary help agency assignment employees generally have the same rights as other employees. There are also rules in the ESA that apply specifically to assignment employees, temporary help agencies and clients of temporary help agencies.

This chapter provides information about the rights and rules that apply only to assignment employees, temporary help agencies, and clients of temporary help agencies. Information about other rights and benefits under the ESA are found in other chapters within the Guide

The Employment Relationship

Where a temporary help agency and person agree, verbally or in writing, that the agency will assign (or try to assign) the person to perform work on a temporary basis for its clients, the agency is the employer of that person and the person is an assignment employee of the agency.

Once there is an employment relationship between an agency and an assignment employee, the relationship continues whether or not the employee is on an assignment (working) with a client of the agency on a temporary basis. The fact that an assignment ends does not in itself mean that the employment relationship ends.

Example

Joel and a temporary help agency agree on June 1st that the agency will try to find Joel temporary work with one of its clients. Two months pass before the agency assigns Joel to work for a client on August 1st. The client ends the assignment on September 1st. The agency does not terminate Joel’s employment and he does not quit.

One month goes by before Joel is given a second assignment on October 1st. The assignment ends on December 31st. The agency also gives Joel written notice that it is terminating his employment with the agency on that date.

In this scenario, Joel was an assignment employee with the temporary help agency (i.e., had an employment relationship with the agency) from June 1st to December 31st.

A Work Assignment

A work assignment begins on the first day the employee does work for, or receives training from, a client of the agency. It ends when the term of the assignment ends, or when the assignment is ended by the agency, the assignment employee, or the client.

Record Keeping Requirements

An agency must record the number of hours an assignment employee worked for each client in each day and each week. The client(s) must also record the number of hours the assignment employee worked for them in each day and each week.

The agency and client(s) must retain those records for three years after the day or week to which the information relates. These records must be readily available for inspection by an employment standards officer, even if the agency and/or client(s) has arranged for another person to retain the records.

Information Assignment Employees Must Receive When Hired by an Agency

A temporary help agency must provide the following written information to an assignment employee as soon as possible after the person becomes an employee:

the legal name of the agency, as well as any operating or business name of the agency (if it is different from the legal name);

contact information for the agency, including its address, telephone number and one or more contact names; and,

Information Assignment Employees Must Receive When Offered Work Assignments

A temporary help agency is also required to provide the following information to an assignment employee when offering him or her a work assignment with a client:

the legal name of the client, as well as any operating or business name of the client (if it is different from the legal name);

contact information for the client, including its address, telephone number and one or more contact names;

the hourly or other wage rate or commission and benefits associated with the assignment;

the hours of work;

a general description of the work;

the estimated term of the assignment (if known when the offer is made); and,

the pay period and pay day.

This information can be provided verbally when the work assignment is offered, but must be provided in writing as soon as possible.

Prohibitions on Charging Fees to Assignment Employees and Restricting Assignment Employees from Accepting Employment with Clients

A temporary help agency is not allowed to charge a fee to an assignment employee, or prospective assignment employee, for:

becoming an employee of the agency;

the agency assigning or trying to assign the employee to perform temporary work for a client; or,

the agency providing the employee with help in preparing resumes or in preparing for job interviews, even if the employee is told he or she can choose whether to take that assistance or not.

An agency is prohibited from attempting to restrict an assignment employee from accepting direct employment with an agency client. It also cannot charge the employee a fee for accepting direct employment with a client of the agency.

Prohibitions on Charging Fees to Clients and Restricting Clients from Hiring Assignment Employees

A temporary help agency is not allowed to charge a fee to a client of the agency for entering into a direct employment relationship with an agency’s assignment employee unless the agency charges the fee during the six months beginning on the first day the assignment employee first begins working for that client through the agency;

An agency is not allowed to restrict a client from entering into a direct employment relationship with an assignment employee.

Job References

A temporary help agency is not allowed to stop its client(s) from providing a job reference for an assignment employee.

Terms of a contract or an agreement (whether or not in writing) that impose any of the above fees or restrictions are void.

Public Holidays

Temporary help agency assignment employees generally have the same public holiday rights as other employees. Please see Public Holidays for more information. YYou may also wish to refer to the Public Holiday Pay Calculator, available at Ontario.ca/ESAtools.

When Employee is on Assignment and a Public Holiday Falls on a Day that Would Ordinarily be a Working Day

Generally, if a public holiday falls on a day when the employee is on an assignment and that day would ordinarily be a working day under the terms of the assignment, the employee is entitled to the day off with public holiday pay. Public holiday pay is all the regular wages earned plus vacation pay payable in the four weeks before the week in which the holiday falls, divided by 20.

The employee may also agree, in writing, to work on the holiday and in that case will:

have a right to their regular pay for that day and a substitute day off with public holiday pay; OR,

get premium pay for every hour worked on the holiday plus public holiday pay.

Example

Two months after her last assignment, Munira is placed on a two-week assignment working Monday through Thursday each week. She is paid $1000 per week. The current assignment begins one week prior to the week Family Day occurs and ends the Thursday following the holiday. She would ordinarily have worked on the day the holiday fell (pursuant to her assignment) so is entitled to Family Day as a day off with public holiday pay for the day.

Her public holiday pay in this case is calculated as the regular wages she earned
($1000) plus any vacation pay payable ($0) within the period of four work weeks prior to the work week in which the holiday fell, divided by 20. Her public holiday pay for Family
Day is $50.

When Employee is on Assignment and a Public Holiday Falls on a day that Would Not Ordinarily be a Working Day

If the employee is on assignment but the holiday falls on a day that is not ordinarily a working day for the employee, the employee will generally get a substitute day off with public holiday pay. The employee may also agree (in writing) to public holiday pay only.

Example

Shana is on an assignment from March 1 to April 30, 2010 and is scheduled to work only Tuesdays and Thursdays of each week. She earns $1000 per week on this assignment. There is one public holiday during this assignment - Good Friday – which falls on the first Friday in April. Since Fridays are not days that she is ordinarily scheduled to work pursuant to her assignment, Shana is entitled to a substitute day off for Good Friday with public holiday pay calculated as if the substitute day was a public holiday.

The substitute day off must be scheduled within three months following the public holiday or within 12 months if Shana and her employer agree in writing. The public holiday pay is based on all the regular wages earned and vacation pay payable in the four work weeks prior to the week in which the substitute day is scheduled, divided by 20.

The substitute day off is scheduled for Thursday April 29. She earned $4000 in regular wages (no vacation pay was payable) in the four work weeks prior to the week she is scheduled to take the substitute day off and is therefore entitled to $200 in public holiday pay. Alternatively, Shana may agree (in writing) to public holiday pay only for Good Friday (with no substitute day off).

When a Public Holiday Falls on a Day when the Employee is not on an Assignment

If the holiday falls on a day that the employee is not on assignment, the employee will generally be entitled only to public holiday pay for the holiday.

Example

Willie ends a six-month assignment on Friday, February 12, 2010. He had been earning $800 a week while on that assignment. He is offered another assignment that begins on April 15, 2010, which he accepts. Family Day falls on February 15, 2010 but because he is on a lay-off when the holiday occurs, he is entitled only to public holiday pay for Family Day (no substitute day off).

The public holiday pay is calculated as the regular wages earned ($3,200) and vacation pay ($0) payable in the four work weeks prior to the week in which the holiday falls, divided by 20. In this case, Willie is entitled to $160 in public holiday pay.

Example

Deepak ends a six-month assignment on May 30, 2010. Canada Day falls on July 1, 2010. He was available and able to work but was not offered another assignment between May 30 and July 1. Because he is on a lay-off when the holiday falls, he is entitled only to public holiday pay for the day. His public holiday pay is calculated as the regular wages earned and vacation pay payable in the four work weeks prior to the week in which the holiday falls, divided by 20. Because he has no earnings for that period, his public holiday pay for Canada Day is $0.

Termination of Employment

Temporary help agency assignment employees generally have the same rights as other employees to notice of termination. Please refer to “Termination of Employment” for more information. However, some termination rules apply only to assignment employees; they are described below.

Requirements during notice period

During each week of notice, an assignment employee is entitled to be paid of the wages he or she is entitled to receive, which cannot be less than,

In the case of a termination other than a termination that results from a lay-off going on longer than a “temporary lay-off”, the total amount of wages earned by the assignment employee in the 12 weeks ending on the employee’s last day of work for a client of the agency, divided by 12;or

In the case of a termination that results from a lay-off going on longer than a “temporary lay-off”, the total amount of wages earned by the assignment employee in the 12 weeks before the deemed termination date, divided by 12.The deemed termination date is the first day of the lay-off.

Pay in lieu of notice

If the employee is being terminated without working notice, pay in lieu of notice is calculated as the amount of wages earned in the 12 weeks ending on the employee’s last day of work for a client of the agency or, in the 12 weeks before the deemed termination date, if the termination is triggered by a lay-off going on longer than a “temporary lay-off”, divided by 12, and multiplied by the number of weeks of notice to which the employee is entitled.

Termination Resulting from a Lay-Off

Termination of employment may be triggered by a lay-off that lasts longer than a “temporary lay-off” . An assignment employee is considered to be on a week of layoff if he or she is not assigned by the agency to perform work for a client of the agency during that week. A week is not counted as a week of layoff (i.e., is an “excluded” week) if, for one or more days, an assignment employee

is not assigned to perform work for a client of an agency because of a strike or lock-out at the agency.

For information on how a lay-off results in termination of employment, please refer to temporary lay-off in the Termination of Employment Chapter.

Mass Termination

A temporary help agency assignment employee may also have a right to mass notice of termination of eight, 12 or 16 weeks. Assignment employees may have a right to mass notice of termination if 50 or more have their employment terminated by their agency in a single four-week period because their assignments at a single client’s establishment ended.

Example

Christine is one of 100 assignment employees who are assigned by ABC Staffing Services, a temporary help agency, for an anticipated ten-month period of work at one of its clients, DEF Manufacturing.

After six months, DEF Manufacturing changes its production plans and ends the assignments of the 100 ABC Staffing Services employees immediately. Because the assignments with DEF end, and ABC does not anticipate being able to find other assignments for 70 of its affected assignment employees, ABC terminates the employment of these 70 employees, including that of Christine, without notice.

The agency tells the remaining 30 employees that it will try to place them in other assignments, i.e., that it is maintaining its employment relationship with them.

The 70 employees that are being terminated are entitled to mass notice of termination. Because the number of employees who have been terminated is between 50 and 199, Christine and each of the other affected employees are entitled to eight weeks’ pay in lieu of notice.

Severance of Employment

Temporary help agency assignment employees generally have the same rights as other employees to severance pay. An employee is entitled to severance pay if his or her employment is severed, he or she has been employed for at least five years and certain other conditions are met. (The five-year threshold is based on the total time the employee is employed by the agency, not the duration of any particular assignment.) Please refer to “Severance Pay” for more information. However, some severance pay some rules apply only to assignment employees; they are described below.

Calculating Severance Pay

To calculate the amount of severance pay an assignment employee is entitled to receive:

Either

in the case of a severance other than a severance that results from a lay-off going on for 35 weeks or more in a 52-week period, take the total amount of wages earned by the assignment employee for work done for clients of the agency during the 12-week period ending on the last day the employee did work for a client of the agency; or

in the case of a severance that results from a lay-off going on for 35 weeks or more in a 52-week period, take the total amount of wages earned by the assignment employee for work done for clients of the agency in the 12 weeks before the first day of the lay-off;

divide the amount in 1(a) or 1(b) by 12;

multiply the result in 2 above by the lesser of 26 and the sum of:

the number of years of employment the employee has completed; and

the number of completed months of employment in the incomplete year, divided by 12.

Severance Resulting from a Lay-Off

One of the ways in which a severance of employment may be triggered is by a lay- off that lasts for 35 weeks or more in a 52-week period[ 1 ]. An assignment employee is considered to be on a week of layoff if he or she is not assigned by the agency to perform work for a client of the agency during that week. A week is not counted as a week of layoff (i.e., is an “excluded” week) if, for one or more days, an employee:

is not assigned to perform work for a client of an agency because of a strike or lock-out at the agency.

For information on how a lay-off results in the severance of employment, please refer to when severance occurs in the Severance Pay Chapter.

Reprisal by a Client of an Agency

As the employer of an assignment employee, a temporary help agency is not allowed to penalize an assignment employee for doing things such as asking questions about his or her ESA rights, filing a claim under the ESA or otherwise exercising his or her rights. Please refer to “Reprisals” for more information.

In addition, a client of a temporary help agency is not allowed to penalize a temporary help agency assignment employee because, for example, he or she has asked about his or her ESA rights, asserted those rights, or asked the client or the agency to comply with the ESA. That means a client is not allowed to:

intimidate the employee;

refuse to have the employee perform work;

refuse to allow the employee to start an assignment;

terminate the assignment of the employee; or,

otherwise penalize or threaten to penalize the employee

for any of the above stated reasons.

Enforcement of Temporary Help Agency Employment Rules

Assignment or prospective assignment employees who believe their agency is not complying with the ESA, and assignment employees who believe the agency or a client of the agency has penalized them for, among other things, asking about or for their ESA rights, may file a claim with the Ministry of Labour. Please see the chapter “Filing an Employment Standards Claim” for more information.

There are additional ways the Ministry of Labour can enforce the ESA when there are violations of some of the rights specific to assignment employees:

If an agency has charged an assignment employee or a prospective assignment employee a prohibited fee, an employment standards officer may issue an order to recover the fees for the employee;

If an agency has interfered with the assignment employee getting direct employment with a client of the agency or prevented a client from providing a job reference for an assignment employee, and the assignment employee has suffered damages as a result, an officer may order compensation for any loss incurred; and/or,

If a client of the agency has penalized an assignment employee, an officer may issue an order for compensation for any loss incurred and/or reinstatement in the assignment

Agency and Client Jointly and Severally Liable for Unpaid Wages

As the employer of the assignment employee, the agency is liable for all wages that are unpaid. However, as of November 20, 2015, if an assignment employee performs work for a client and the agency fails to pay the employee for some or all of the wages owed for that pay period, the client(s) may be jointly and severally liable together with the agency for some or all of those unpaid wages. Specifically, clients may be liable for unpaid regular wages, overtime pay, public holiday pay and public holiday premium pay.

If an assignment employee performs work for more than one client in any pay period, each client is liable for an amount that is proportional to the hours worked for the client, relative to the total hours the employee worked for all clients of the agency, in that pay period.

[ 1 ] A severance can also be triggered by just one week of lay-off if the reason for the lay-off is because the employer is permanently discontinuing all of its business at an establishment. For more information, see "When Severance Occurs" in the Severance Pay chapter of this Guide.